AN ACT to amend Tennessee Code Annotated, Title 45 and Title 47, relative to homeowners.
Impact
The bill impacts Tennessee's foreclosure laws by mandating stricter processes that lenders and mortgage servicers must adhere to before initiating foreclosure proceedings. This includes a requirement for a pre-foreclosure notice to borrowers, outlining their rights and available options, which should help prevent rushed or improper foreclosures. Additionally, the bill stipulates that foreclosure actions cannot commence until a significant timeframe has elapsed allowing borrowers to explore alternatives. These new protections intend to create a more equitable environment for homeowners experiencing financial difficulties, particularly in light of economic challenges affecting many families.
Summary
House Bill 1172, known as the 'Homeowner Bill of Rights', aims to amend Tennessee laws related to homeowners, particularly focusing on mortgage and foreclosure processes. This legislation introduces various provisions designed to protect borrowers from wrongful foreclosure practices and to ensure they are informed of their rights. Among other things, it requires mortgage servicers to communicate transparently with borrowers regarding foreclosure alternatives and to establish a dedicated point of contact for each borrower, thereby simplifying access to necessary support and documentation throughout the process.
Contention
There may be points of contention surrounding the bill, particularly from mortgage lenders and servicers who might argue that the new requirements could complicate and prolong the foreclosure process, potentially leading to increased risks and costs for them. On the other hand, advocates for homeowners believe that these protections are necessary to safeguard vulnerable borrowers who may not fully understand their rights or the complexities of the foreclosure process. The balance between effective lending practices and borrower protection will likely be a focal point of legislative and public debate surrounding this bill.
Provides forbearance of residential mortgage foreclosures under certain circumstances; places additional requirements on attorneys, residential mortgage lenders, and courts, as part of foreclosure process.
Provides forbearance of residential mortgage foreclosures under certain circumstances; places additional requirements on attorneys, residential mortgage lenders, and courts, as part of foreclosure process.
Relating to prohibiting the non-judicial foreclosure of a loan for the purchase of certain residential property during a loan modification process; providing a penalty.